For governors, a personal toll from budget battles

SALT LAKE CITY — In one state capital after another, this has been a year of painful budgetary choices and, in some cases, pitched political battles. That’s the big picture. On an individual level, it also has been a time of reflection, disappointment and lessons learned for the governors who have been in the forefront of those battles. Will Washington learn from the states?

Talk to state executives gathered here at the summer meeting of the National Governors Association and it quickly becomes clear that the budget fights this year have not just left political scars, but some personal ones as well. As Washington Gov. Christine Gregoire (D) put it, “I’ve just come through a session in which I made rotten decisions.”

In Gregoire’s view, those decisions weren’t bad because they failed to solve the state’s budgetary problems or left her budget hopelessly out of balance. To the contrary, Gregoire oversaw cuts of more than $4 billion that balanced her biennial budget.

Instead, her decisions were personally disappointing because they went against the grain of Gregoire’s political philosophy. By her own account, those cuts will hurt the very people she got into politics to help. She believes she spent this year undoing much of what she had tried to do in her earlier years in office.

“I’ve always believed state government was the ultimate safety net, and it isn’t anymore,” she said. “Not in my state. I’m now out there with the faith community and the nonprofits and so on, saying, you have to pick up. We are eliminating checks for certain segments of our population that today get a check. On Oct. 1 they will get nothing.”

Like many governors, Gregoire cut pay for state workers, reformed the state pension system, asked state employees to pay more for health care and retirement, eliminated cost-of-living increases for some retired state employees and revamped the state’s worker compensation system.

Given the nation’s need to compete more effectively in the global economy, Gregoire said her state and others should be putting more money into higher education. Instead she did the opposite — there and in many other areas. “Those were the cards” she was dealt, she said.

Gregoire made these decisions without some of the rancor seen in some other states. She personally oversaw the negotiations and said she tried to deal with the unions with respect. At one point, thousands of demonstrators showed up to protest, but they were orderly and not disruptive. “It was the most perfect example of freedom of speech I’ve seen,” he said. “I was exhilarated by that.”

Gregoire believes that this represents the new normal for states for the foreseeable future. She believes there will be no imminent return to the flush days of the past. Even when the economy begins to grow again, states will have to live with less and do less. That’s why she said she was signing her budget “with a heavy heart.”

Wisconsin Gov. Scott Walker’s (R) conclusions about the budget fight that prompted outrage in his state and drew national attention are no less personal than Gregoire’s, but far different in how he assesses what was done.

Walker turned Wisconsin into ground zero nationally over the issue of public employee compensation and the power of public employee unions. Republican and Democratic governors have extracted concessions from unions to help balance their budgets. More than any other governor, however, Walker provoked a confrontation that could continue to roil Wisconsin through next year’s election.

His proposal to eliminate collective bargaining for most state employees brought thousands of demonstrators to Madison daily during the heat of the battle, prompted a walkout of Democratic senators and inflamed passions among citizens. After a long legislative struggle and court challenges, Walker’s initiatives have gone into effect.

As he looks back, the new governor does not think he made bad policy decisions. Over time, Wisconsin will be better off as a result, he argues. But he acknowledges that he made several miscalculations that have cost him dearly in terms of his political standing and in the state’s ability to do its business harmoniously.

Given the opportunity to start over, Walker said, he would not back away from confronting public employee unions over pay and compensation and bargaining rights. But he wishes he had laid the foundation for his proposed changes more effectively. He also wishes he had more accurately anticipated the backlash that they would set off in the state and across the country, and says he would have had a political plan to deal with the opposition.

Walker said he came into office with the mindset of both a county executive and a small-business owner. “Identify a problem. Identify a solution. And you just do it,” he said. He set a fast pace in January with the legislature, without preparing the public. That might have worked in other settings, but it backfired on the new governor.

“We didn’t do enough of a job of making the case for what we were doing and why it was needed,” he said.

Walker anticipated an intense but short battle. He admits he underestimated the powerful reaction, particularly outside of his state. “Where I was really shocked [was] not so much the public’s reaction [in Wisconsin] as much as it was the national reaction,” he said.

He continues to pay the price. Wisconsin remains in political turmoil. Recall elections are pending for nine state senators, six Republicans and three Democrats. Republicans could lose their Senate majority as a result. The governor could face a recall next year.

Lawmakers, the political parties and their coalitions are now consumed with elections and recriminations, rather than being able to concentrate on finding ways to create jobs and fix the economy — the major promises of Walker’s campaign.

“It’s tough,” Walker said about the GOP’s prospects for holding onto the Senate. He argued that the more Wisconsin citizens learn about the effects of the changes in his budget, particularly in education, the more they will see them positively. “If the election were January 9th rather than August 9th, I’d feel a lot better,” he said.

Gregoire, serving as this year’s NGA chairman, has decided not to seek reelection in 2012. She says that her state will be better off over the next year if she is not in the middle of a campaign. Walker will govern in a polarized environment for a long time. He will have to try to regroup from his difficult start.

The other lesson from the states is obvious. As President Obama and lawmakers in both parties try to resolve their dispute over the budget and the debt ceiling, the experiences of these two governors — and many others — stand as a reminder that there will be nothing cost-free about their solution, whatever it turns out to be.